One thing is clear from the Unified Agenda: Rulemaking under the JOBS Act will continue to take up considerable staff time.
Proposals designed to implement Regulation A+ are on the table. So are Title V (exclusion of shares from Section 12(g) that were issued to employees pursuant to an employee compensation plan) and Title VI (applicability of Section 12(g) to banks). Crowdfunding is on the list, although interestingly as a proposal rather than a final rule. Having already proposed rules implementing this exemption, see Exchange Act Release No. 70741 (October 23, 2013), this suggests that the Commission does not expect to complete the rulemaking during the next 12 months.
The Unified Agenda also includes, under the category of "proposed rule stage," the implementation of Title I of the JOBS Act. Title I governs emerging growth companies. This item has been on the Unified Agenda since 2012.
Most of the titles in the JOBS Act are replete with instances where the Commission is instructed to adopt rules. That is not true with respect to Title I. In most cases, references to rules are expressed as prohibitions on their application to emerging growth companies. See, e.g., Section 105(c) (prohibiting Commission and stock exchanges from adopting rules regulating certain actions by analysts in connection with emerging growth companies).
There is, however, at least one significant exception. Section 106(b) amended Section 11A(c) of the Exchange Act to add a section titled "Tick Size." Under the provison, the Commission must "conduct a study examining the transition to trading and quoting securities in one penny increments, also known as decimalization." Once the study was done, the JOBS Act provided that "[i]f the Commission determines that the securities of emerging growth companies should be quoted and traded using a minimum increment of greater than $0.01, the Commission may . . . designate a minimum increment for the securities of emerging growth companies that is greater than $0.01 but less than $0.10 for use in all quoting and trading of securities in any exchange or other execution venue.’’
The Commission has completed the study. The study did not call for any specific rulemaking but did call for the solicitation of comments:
- The Staff believes that the Commission should solicit the views of investors, companies, market professionals, academics, and other interested parties on the broad topic of decimalization, how to best study its effects on IPOs, trading, and liquidity for small and middle capitalization companies, and what, if any, changes should be considered.
The Unified Agenda does not specify the rulemaking endeavors that will be proposed under Title I of the JOBS Act. Solicitation of comments on, or changes to, tick size may be one of them.